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R&R: AAR puts full loan amount in escrow

B

bierkenstock

Guest
From Radio and Records:

Air America Radio Puts Disputed
Loan Funds In Escrow

The New York City-based liberal Talk network's Board of Directors has deposited $875,000 in an escrow account created to repay New York's Gloria Wise Girls and Boys Club for loans the organization made to the network under its then-CEO Evan Cohen. ...

In response to reports yesterday that Air America host Al Franken was a signee of a settlement agreement last year that included the loans as part of the network's liabilities, Goldberg said, "Al Franken does not have, and never had, any responsibility for this loan. His role at Air America was then, and remains today, as an on-air talent." ...

http://www.randr.com/Newsroom/2005_09_08/airamerica.asp
 
> From Radio and Records:
>
> Air America Radio Puts Disputed
> Loan Funds In Escrow
>
> The New York City-based liberal Talk network's Board of
> Directors has deposited $875,000 in an escrow account
> created to repay New York's Gloria Wise Girls and Boys Club
> for loans the organization made to the network under its
> then-CEO Evan Cohen. ...

Which translates into two words for this drama: the end. :)
 
> > From Radio and Records:
> >
> > Air America Radio Puts Disputed
> > Loan Funds In Escrow
> >
> > The New York City-based liberal Talk network's Board of
> > Directors has deposited $875,000 in an escrow account
> > created to repay New York's Gloria Wise Girls and Boys
> Club
> > for loans the organization made to the network under its
> > then-CEO Evan Cohen. ...
>
> Which translates into two words for this drama: the end.
> :)
>

You wish.
 
The AAR mess

> > From Radio and Records:
> >
> > Air America Radio Puts Disputed
> > Loan Funds In Escrow
> >
> > The New York City-based liberal Talk network's Board of
> > Directors has deposited $875,000 in an escrow account
> > created to repay New York's Gloria Wise Girls and Boys
> Club
> > for loans the organization made to the network under its
> > then-CEO Evan Cohen. ...
>
> Which translates into two words for this drama: the end.
> :)
>

Not necessarily (especially with this crowd and the Equalizer still on the case).

OT: who was the Equalizer on TV? His name escapes me now.

Anywho...

After reading the settlement agreement, a couple things strike me as interesting. I will not mention anything on the Equalizer's blog because I pride myself on having never read it--though I did use its links to get the settlement agreement document(s).

1) It's not, as you stated in a thread below, an asset and ownership transfer. That document would be totally different from this settlement agreement. It would be important to see the asset transfer agmt. too, to get the whole scope.

2) Despite his comments otherwise, Al Franken was an investor in Air America, perhaps from the beginning, but definitely while under Cohen/PMI/RFA ownership and management. It was in this capacity as investor that Franken signed. He does not fall into any other group or party to the agreement.

The parties, as defined in the agmt.:
1) Piquant, LLC (current AAR owner)
2) Investors listed in Schedule A
3) Cohen
4) Sorensen
5) C3&S Media Properties

Franken gets defined specifically in the Definitions section of the agmt (who knows why--so does a Walter Leaphart, Jr....whoever he is). But Franken is still an investor.

3) This babble by Franken that he signed the document but didn't read it is a non-starter. He's still liable and bound by the terms of it. Just because his lawyer didn't tell him what he's signing doesn't make the effect of that document less. If anything, and if true, Franken needs to talk to his lawyer--and pursue any recovery against him for losses incurred by Franken in relation to something he signed but didn't read. Further, by signing Franken admitted, pursuant to Section 22.4 of the Agreement that he read it.

4) Piquant had more than a moral obligation to pay back the "loan" from the Boys and Girls Club--if any claim for the liabilities of Schedule 21.7 was asserted against Cohen, Piquant had an obligation to indemnify Cohen for those claims. This specifically includes the Boys and Girls Club loan; if a claim was asserted against Cohen for it, Piquant had to indemnify Cohen for that claim. This is in addition to whatever was stated in the aseet and ownership transfer document in regards to the Boys and Girls Club "loan" and other AAR liabilities.

Overall, the document is pretty ho-hum (though I found out that well-known Cleveland radio guys Norm "WIXY 1260 Founder" Wain and Tom Embrescia were investors). It's lengthy and a typically boring legal settlement. It's probably not a smoking gun for anything more than the fact that it says that Piquant acknowledges that the Boys and Girls Club "loan" existed and was an outstanding liability.

Also, there's not evidence here that the "loan" was to Cohen personally, despite what some have said. It appears as an AAR liability--so that it must be.
 
Re: The AAR mess

> 1) It's not, as you stated in a thread below, an asset and
> ownership transfer. That document would be totally
> different from this settlement agreement. It would be
> important to see the asset transfer agmt. too, to get the
> whole scope.

That was apparently done in May 2004. Maybe that was the thing we saw get signed in the HBO documentary in the dead of night.

> 2) Despite his comments otherwise, Al Franken was an
> investor in Air America, perhaps from the beginning, but
> definitely while under Cohen/PMI/RFA ownership and
> management.

I'm not sure if/when he ever denied this.

> 3) This babble by Franken that he signed the document but
> didn't read it is a non-starter.

I agree. If you don't read it and sign it anyway, tough luck to you.

> Also, there's not evidence here that the "loan" was to Cohen
> personally, despite what some have said. It appears as an
> AAR liability--so that it must be.

I have not seen anyone say it was a loan -to- Cohen. The loan was arranged by Cohen under his association with both AAR and B&G. It was obviously a loan to AAR. AAR knew about the loan. How much could be discussed about it may have been restricted by the confidentiality agreement.

BTW, this all assumes this is the actual document in its entirety and is true to form. I haven't seen AAR deny its authenticity, but we always have to be careful with these kinds of things.
 
Re: The AAR mess

> > 1) It's not, as you stated in a thread below, an asset
> and
> > ownership transfer. That document would be totally
> > different from this settlement agreement. It would be
> > important to see the asset transfer agmt. too, to get the
> > whole scope.
>
> That was apparently done in May 2004. Maybe that was the
> thing we saw get signed in the HBO documentary in the dead
> of night.

Correct. The settlement agreement references the asset transfer document(s) from May 2004. It hasn't been publicly released, to my knowledge.

> > 2) Despite his comments otherwise, Al Franken was an
> > investor in Air America, perhaps from the beginning, but
> > definitely while under Cohen/PMI/RFA ownership and
> > management.
>
> I'm not sure if/when he ever denied this.

From the NY Sun article "Franken Signed Air America's Payment Pact," September 7, 2005 (linked on another thread here):

"'I am not an investor, and I didn't see this thing,' Mr. Franken, the comedian and best-selling author who hosts Air America's daily show 'The O'Franken Factor,' said."

Just pointing this out. It doesn't matter much in the story; it would just be nice if Franken would admit he was an investor and had more than just a moral sense in seeing AAR succeed. I'd commend him for that--he put money where his heart (and mouth) are.

> > 3) This babble by Franken that he signed the document but
> > didn't read it is a non-starter.
>
> I agree. If you don't read it and sign it anyway, tough
> luck to you.
>
> > Also, there's not evidence here that the "loan" was to
> Cohen
> > personally, despite what some have said. It appears as an
>
> > AAR liability--so that it must be.
>
> I have not seen anyone say it was a loan -to- Cohen.

You may be correct. I had a recollection in my mind that someone on this board said it was a loan to Cohen. I may be incorrect there. Regardless, it is NOT a loan to Cohen personally, but to either PMI or RFA or ET. It is an AAR obligation, and assumed by Piquant as an AAR liability.

> The
> loan was arranged by Cohen under his association with both
> AAR and B&G. It was obviously a loan to AAR. AAR knew
> about the loan. How much could be discussed about it may
> have been restricted by the confidentiality agreement.
>
> BTW, this all assumes this is the actual document in its
> entirety and is true to form. I haven't seen AAR deny its
> authenticity, but we always have to be careful with these
> kinds of things.

Correct. I have no reason to doubt the veracity of it--if it was obtained by discovery, it is what it is. It seems proper (the date on the first page being blank notwithstanding--the notarized signatures are on separate, but close together dates, so maybe it was just convenience). But it could be just something revealed in discovery that doesn't mean anything because it wasn't complete or whatever.

For the moment, it is what it is, and at the very least describes the mindset of the parties in November 2004 as to the B&G "loan".
 
Re: The AAR mess

> 2) Despite his comments otherwise, Al Franken was an
> investor in Air America, perhaps from the beginning, but
> definitely while under Cohen/PMI/RFA ownership and
> management. It was in this capacity as investor that
> Franken signed. He does not fall into any other group or
> party to the agreement.

Huh? The agreement specifically says that Franken was NOT an investor, in the beginning or later on. Read the agreement!

> Franken gets defined specifically in the Definitions section
> of the agmt (who knows why--so does a Walter Leaphart,
> Jr....whoever he is). But Franken is still an investor.

No, he is not. Nowhere is he "defined" as an investor. Read the agreement. He signed the agreement because he went without a salary for a while and was still owed money.
>
> 3) This babble by Franken that he signed the document but
> didn't read it is a non-starter. He's still liable and
> bound by the terms of it.

Liable for what? Where do you see that Franken is liable for anything? According to a correction printed in the New York Sun today, the agreement "did not commit any party to the payment of those claims" (see below).

> Also, there's not evidence here that the "loan" was to Cohen
> personally, despite what some have said. It appears as an
> AAR liability--so that it must be.

That may be, but Cohen told the New York Sun that nobody else at Air America knew about the "loans."

Mr. Cohen, previously unreachable, told the Sun yesterday that no one at the radio network knew about the transfers while they occurred, which the agreement said was between October 2003 and March 2004.

(snip)
Correction from September 8, 2005

A settlement agreement signed by Al Franken, Evan Montvel Cohen, and other parties acknowledged that the Gloria Wise Boys & Girls Club had claims totaling $875,000 against the Air America radio network, but did not commit any party to the payment of those claims. A front-page story in yesterday's New York Sun misstated the terms of the agreement.

http://www.nysun.com/article/19659
 
Re: The AAR mess

> 2) Despite his comments otherwise, Al Franken was an
> investor in Air America, perhaps from the beginning, but
> definitely while under Cohen/PMI/RFA ownership and
> management. It was in this capacity as investor that
> Franken signed. He does not fall into any other group or
> party to the agreement.
>

Perhaps you read a different document than I did, but there was a sentence in the document specifically saying that Al Franken was NOT an investor.
My feeling is that the only reason he had to sign the document was to release Cohen and others from any liability they had because they stopped paying him. So he gave up any rights to claim back payment.


> Overall, the document is pretty ho-hum (though I found out
> that well-known Cleveland radio guys Norm "WIXY 1260
> Founder" Wain and Tom Embrescia were investors). It's
> lengthy and a typically boring legal settlement. It's
> probably not a smoking gun for anything more than the fact
> that it says that Piquant acknowledges that the Boys and
> Girls Club "loan" existed and was an outstanding liability.
>
> Also, there's not evidence here that the "loan" was to Cohen
> personally, despite what some have said. It appears as an
> AAR liability--so that it must be.
>

I recall some talk of Cohen using some of the money for family medical expenses, but that is not stated here. I don't think it makes much difference at this point, especially after all the money has been put in escrow.
 
Norman Wain's Involvement

> Overall, the document is pretty ho-hum (though I found out
> that well-known Cleveland radio guys Norm "WIXY 1260
> Founder" Wain and Tom Embrescia were investors).

Mr. Wain comes into the investor fold via Randi Rhodes.

Before Randi signed up with AAR, and when she was still a local host on CC's WJNO/West Palm Beach, Norman Wain heard her down there, and was working to help her get a national syndication deal.

-OA<P ID="signature">______________
Ohio Media Watch - <a target="_blank" href=http://ohiomedia.blogspot.com>http://ohiomedia.blogspot.com</a></P>
 
Re: The AAR mess

> > 2) Despite his comments otherwise, Al Franken was an
> > investor in Air America, perhaps from the beginning, but
> > definitely while under Cohen/PMI/RFA ownership and
> > management. It was in this capacity as investor that
> > Franken signed. He does not fall into any other group or
> > party to the agreement.
> >
>
> Perhaps you read a different document than I did, but there
> was a sentence in the document specifically saying that Al
> Franken was NOT an investor.
> My feeling is that the only reason he had to sign the
> document was to release Cohen and others from any liability
> they had because they stopped paying him. So he gave up any
> rights to claim back payment.

Read my response to Scribbler below. Just so I don't repeat myself.

> > Overall, the document is pretty ho-hum (though I found out
>
> > that well-known Cleveland radio guys Norm "WIXY 1260
> > Founder" Wain and Tom Embrescia were investors). It's
> > lengthy and a typically boring legal settlement. It's
> > probably not a smoking gun for anything more than the fact
>
> > that it says that Piquant acknowledges that the Boys and
> > Girls Club "loan" existed and was an outstanding
> liability.
> >
> > Also, there's not evidence here that the "loan" was to
> Cohen
> > personally, despite what some have said. It appears as an
>
> > AAR liability--so that it must be.
> >
>
> I recall some talk of Cohen using some of the money for
> family medical expenses, but that is not stated here. I
> don't think it makes much difference at this point,
> especially after all the money has been put in escrow.
>
 
Re: The AAR mess

> > 2) Despite his comments otherwise, Al Franken was an
> > investor in Air America, perhaps from the beginning, but
> > definitely while under Cohen/PMI/RFA ownership and
> > management. It was in this capacity as investor that
> > Franken signed. He does not fall into any other group or
> > party to the agreement.
>
> Huh? The agreement specifically says that Franken was NOT
> an investor, in the beginning or later on. Read the
> agreement!

I did read it--for the purposes of the agreement Franken IS an investor. He is listed on the Schedule A titled "Investors," notwithstanding the asterisk relaying his particular status.

He would not be included under "investors" unless he had some form of "investment" in the venture. The Schedule is not used as a catch-all--it has some meaning. Every word in the document has meaning attached to it.

He may not have been an investor like, say, Norman Wain (money up front), but Franken had some claim that was settled by this agreement. If Franken gave up money, no matter how long, that was owed to him for the purpose of seeing the venture continue--he is not only a creditor, but also an investor. Since Franken was not included in the liabilities, but in the investor section of the agreement, his claim was extinguished by the settlement.

> > Franken gets defined specifically in the Definitions
> section
> > of the agmt (who knows why--so does a Walter Leaphart,
> > Jr....whoever he is). But Franken is still an investor.
>
> No, he is not. Nowhere is he "defined" as an investor. Read
> the agreement. He signed the agreement because he went
> without a salary for a while and was still owed money.

He signed the agreement because he settled whatever claim he had against AAR for whatever it was he had that claim for. The agreement does not spell out what his claim was--it is mere conjecture on your (our?) parts to say that it was because he wasn't paid.

> > 3) This babble by Franken that he signed the document but
> > didn't read it is a non-starter. He's still liable and
> > bound by the terms of it.
>
> Liable for what? Where do you see that Franken is liable
> for anything? According to a correction printed in the New
> York Sun today, the agreement "did not commit any party to
> the payment of those claims" (see below).

The agreement, and I, never say Franken is liable for any payment. Franken is liable under the terms of the agreement--an agreement which he signed. THAT is what I argued, nothing more.

I made no representation that Franken was liable for any claim. But even the NY Sun is not wholly correct in their correction: no one is committed to the payment of any claims by this agreement (that might have been in the asset transfer).

But as to indemnification:

"Piquant...hereby agrees to indemnify and hold harmless the Cohen Parties from and against any Claims suffered, incurred, or sustained by or asserted against the Cohen Parties arising from or relating to (i) the Liabilities expressly set forth on Schedule 21.7..."

If a claim for payment of the loan to Cohen ever came due, Piquant was obligated to indemnify Cohen for it (in addition to whatever was in the asset transfer).

> > Also, there's not evidence here that the "loan" was to
> Cohen
> > personally, despite what some have said. It appears as an
>
> > AAR liability--so that it must be.
>
> That may be, but Cohen told the New York Sun that nobody
> else at Air America knew about the "loans."
>
> Mr. Cohen, previously unreachable, told the Sun yesterday
> that no one at the radio network knew about the transfers
> while they occurred, which the agreement said was between
> October 2003 and March 2004.
>
> (snip)
> Correction from September 8, 2005
>
> A settlement agreement signed by Al Franken, Evan Montvel
> Cohen, and other parties acknowledged that the Gloria Wise
> Boys & Girls Club had claims totaling $875,000 against the
> Air America radio network, but did not commit any party to
> the payment of those claims. A front-page story in
> yesterday's New York Sun misstated the terms of the
> agreement.
>
> http://www.nysun.com/article/19659
>
 
One would think that the U.S. Justice Department would be trying to get involved, no? State Attorney General?



> From Radio and Records:
>
> Air America Radio Puts Disputed
> Loan Funds In Escrow
>
> The New York City-based liberal Talk network's Board of
> Directors has deposited $875,000 in an escrow account
> created to repay New York's Gloria Wise Girls and Boys Club
> for loans the organization made to the network under its
> then-CEO Evan Cohen. ...
>
> In response to reports yesterday that Air America host Al
> Franken was a signee of a settlement agreement last year
> that included the loans as part of the network's
> liabilities, Goldberg said, "Al Franken does not have, and
> never had, any responsibility for this loan. His role at Air
> America was then, and remains today, as an on-air talent."
> ...
>
> http://www.randr.com/Newsroom/2005_09_08/airamerica.asp
>
 
> One would think that the U.S. Justice Department would be
> trying to get involved, no? State Attorney General?

They investigate actual crimes, not right wing blogger hit pieces. The DOI will take care of Mr. Cohen and friends.
 
False statement

> > One would think that the U.S. Justice Department would be
> > trying to get involved, no? State Attorney General?
>
> They investigate actual crimes, not right wing blogger hit
> pieces. The DOI will take care of Mr. Cohen and friends.
>

This is false. Read NY Post and NY Sun. Eliot Spitzer and city investigators both looking into Air America's role.
 
Re: False statement

> > > One would think that the U.S. Justice Department would
> be
> > > trying to get involved, no? State Attorney General?
> >
> > They investigate actual crimes, not right wing blogger hit
>
> > pieces. The DOI will take care of Mr. Cohen and friends.
> >
>
> This is false. Read NY Post and NY Sun. Eliot Spitzer and
> city investigators both looking into Air America's role.

Not exactly. Spitzer and the city's DOI are looking into Evan Cohen's actions when he was an executive of both the Boys and Girls Club and Air America, before he was ousted from both positions. The NY Sun quoted Cohen as saying that nobody else at Air America was even aware of the loans from the Boys and Girls Club that he arranged. In any case, the focus of the investigations is on the financial irregularites that went on at the Boys and Girls Club, despite what the right wing media are trying to make you believe. Somehow I doubt that the right would be up in arms if Mr. Cohen had invested the money in a Las Vegas casino or Rupert Murdoch's media empire.
 
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